The U.S. Energy Department said on Feb. 28 it is offering up to 6 MMbbl of sweet crude oil from the national emergency reserve in a sale mandated by previous laws to raise funds to modernize the facility.
Laws passed by Congress in previous years require the department to hold sales to pay for improvements to the Strategic Petroleum Reserve which is held in caverns on the coast of Texas and Louisiana.
The delivery period for the oil will be from May 1 to May 14 for oil from the reserve's West Hackberry and Big Hill site, and from May 1 to May 31 from the Bryan Mound site. Offers for the oil must be received by March 13, the department said.
While global oil prices have been rising as the oil production group OPEC and Russia work together to cut supplies, the sale did not appear to be aimed at balancing markets. U.S. Energy Secretary Rick Perry, who has said price impacts from tapping the reserve for supply balance are often temporary, did not mention the sale in a press conference earlier on Feb. 28.
New York energy company Consolidated Edison Inc. (Con Ed) said it still plans to impose a moratorium on new natural gas service in parts of Westchester County after March 15 despite a $250 million plan by the state to reduce energy usage.
Crude oil production in the U.S. continued to grow to a record high of 12.1 million barrels per day, rising from the all-time high in the previous week.
Stranded gas in the Permian Basin crushes Waha spot prices to around 12 cents/MMBtu.